The excitement that has set on the Litecoin (LTC) Abra partnership is fizzling out barely a few days after the deal was “sealed”. Abra is backed by AmEX and is utilizing Litecoin platform smart contracts for its payment globally. This created a lot of hype only for the LTC prices in the charts to plummet.
The reaction from the market showed a lot of anticipation and both critics and enthusiasts and the price surge and dip indicate the frustration in the market. However, all is not lost according to Charlie Lee, The Litecoin creator.
“Like everyone else, we got too excited about something that was too good to be true and we optimistically overlooked many of the warning signs.”
The founder has since clarified that Litecoin Foundation and Abra “partnership” only allowed the former to use the open source code. The failure though does not reflect on the platforms ability to deliver on its promises. The essence of the partnership is to increase the gains of both parties and not to reverse the current ones.
Litecoin (LTC) Chart Analysis
After Abra raised $40 million, Litecoin (LTC) was the natural choice to power their exchange and wallet using the smart contract technology. This has seen a shift of Litecoin shift in price northwards but the gains were lost in less than 48 hours. The coin is trading at $117.29 recording meager 2.71% gains against the dollar.
The announcement pushed LTC price by almost 20% which saw the coin trade at $136.02 on April 3rd. the Abra CEO cited system compatibility failure that led to the derailment of the plans. Given the market forces, the shortfall had to be reflected in the market. He affirmed their Litecoin preference to Bitcoin was based on the market trends and demand.
“Litecoin’s compatibility with Bitcoin was a “major factor” while selecting the Litecoin network”… adds Abra C.E.O Bill Barhydt.
The creation of Litecoin (LTC) was to correct Bitcoin failure and specifically the issue of transaction fees. Litecoin fee is the lowest and value for money for any investor worth their salt. Secondly, Litecoin offers fast transaction speeds that Bitcoin cannot match.
Litecoin offers easy to use mining algorithms compared to Bitcoin. You can mine LTC with less powerful computers which consume less power. The accrued benefits go directly to the platform and investors unlike Bitcoin where miners are the ones to benefit. Abra is seeking to a platform that will drive their agenda into the future, a quality that Bitcoin is lacking at the moment.
“If Abra can attract a significant amount of users it will further drive demand for Litecoin which in turn could reduce the circulating amount of LTC, pushing the trading price up…” adds Bill Barhydt.
Litecoin (LTC) LitePay and Abra Exchange Platform
At the moment, Abra exchange is only supporting investors in the retail industry and is yet to get to the level of GDAX. This is the reason why it chose to use Litecoin’s LitePay due to the system compatibility and the user needs. It seeks to expose LTC asset value to its users and give it a global appeal.
Litecoin scalability and lightening support are some of the factors that Abra cites. Despite the flaws that have been discovered leading to the Litecoin shut down, Litecoin (LTC) still leads in the sector. Its growth is based on transaction speed, multi-system compatibility and security.
The smart contract failure should be the wakeup call for this digital currency sleeping giant. It is about time to put their house in order before the market recovers. Investors are shying away once they discover the platform cannot deliver on their promise if the Abra issue is anything to go by.